Basel II application in Spain

As is well known, the Basel Committee on Banking Supervision adopted, in June 2004, a not binding framework agreement on the international convergence of capital measurement and capital standards ("Basel II"). This new framework agreement came to substitute the old 1988 Basel accord. Basel II is divided in three essential Pillars: Pillar 1, minimum capital requirements; Pillar 2, supervisory review process; and Pillar 3, market discipline.